REHOBOTH — The Rehoboth town government was able to compensate for a nearly $1.7 million shortfall without making any layoffs through a revised fiscal 2015 budget that was approved at a special Town Meeting held on Thursday night.

Much of the shortfall was made up for through proposed cuts submitted by the town’s various departments, in addition to approximately $153,000 in excess transportation funds returned early by the school district and revisions to revenue estimates, said Michael Deignan, chairman of the Rehoboth Finance Committee.

Crucially, about half of the deficit was made up with a real estate fund that members of the Board of Selectmen were made aware of earlier this week, Deignan said.

“The departments made decisions simply to go without this year,” Deignan said. “The balance came out of a sale of real estate account. The town owned some property, the North School and the state police barracks. When we sold that property, we stuck it into a real estate account that we were going to use for public safety improvements. It’s a one-time revenue source it will not be there next year. It’s a patch to get us through this year.”

Deignan said that until this week, town officials were not aware that the town could lawfully use the real estate fund to help bridge the budget deficit, which resulted from a failed Proposition 2½ ballot vote in July. The failed Proposition 2½ referendum came after voters at the annual spring Town Meeting passed a $14.9 million in regional school district spending, which was a nearly $1.7 million increase from the state minimum recommended by the Rehoboth Finance Committee. The school spending makes up a majority of the town budget, which was originally passed in the spring at $22.1 million for this fiscal year.

Deignan, who told special Town Meeting voters about his encounters with town employees who were crying after the failed Proposition 2½ vote, credited the department heads and the workers for helping to make necessary cuts.

“Our town employees really stepped up to the plate,” he said. “They made their sacrifices ... to bring us into balance.”

Cuts to the Rehoboth police will prevent the department from filling three vacant positions, Deignan said.

“Nobody is getting laid off,” Deignan said. “All the salaries are level-funded. ... No one takes a pay cut or reduction in hours.”

At the beginning of the meeting, Selectman Joseph Tito warned voters that the town’s budget problems are not gone, and he added that Rehoboth is now exploring possibilities for increased revenue, including hiring a so-called revenue czar.

“It does not heal us,” Tito said. “We still have work going forward. We still have the basic mismatch of costs and revenues in our town.”

Page 2 of 2 - Prior to the special Town Meeting voting on Thursday night, Tito and others also asked voters to support the revised budget, explaining that any modifications made by the voters would need to be balanced in other areas of the budget. The voters complied, and no changes were made, except for a few minor adjustments put forward by Deignan.